Recent data reveals a significant decline in XRP’s locked liquidity, signaling a possible slowdown in the cryptocurrency’s DeFi growth. As of August 28th, approximately 11.7 million XRP is now pooled across XRPL automated market maker (AMM) contracts, marking a drop from over 14 million just four months ago. This decline coincides with stagnant price action for XRP, which has struggled to hold onto its support levels.
The dip in locked liquidity might be attributed to weakening investor confidence, as some liquidity providers withdraw capital amid shifting market sentiment caused by prolonged uncertainty. While the total value locked (TVL) on XRPL remains stable at $99.47 million, with no significant changes over the past 24 hours, a noticeable decline is observed in activity within XRPL’s decentralized exchange (DEX), which has experienced a weekly drop of 1.65%.
Overall, the trend suggests a decrease in liquidity provider engagement on the XRP ledger, impacting both DeFi activity and XRP’s price movement.